Core ideas:
Acquire Shanhai Industry and Trade and Lhasa Pingzhi to enhance the added value of products
Event: on April 3, 2018, the company announced that the company intends to acquire 100% stake in Shanhai Industry and Trade and Lhasa Pinzhi in cash. As a regional leader, the company has actively expanded its business territory through external mergers and acquisitions since its listing. This acquisition will help to enhance the company's mineral processing business of comprehensive recovery in the future.
Expand the company's business industrial chain and improve the company's recovery and mineral processing capacity
Shanhai Industry and Trade and Shanhai Industry and Trade are mainly engaged in the commissioned processing and derivatives sales of copper, lead and zinc and other mineral products. According to the company announcement, the net profits of Shanhai Industry and Trade and Lhasa Pinzhi in 2017 were 14.84 million yuan and 447100 yuan respectively. The completion of this acquisition will effectively enhance the company's comprehensive recovery capacity of valuable metals and complex metals, enhance the added value of the company's mineral products, increase the economic benefits of the mine, and enhance the comprehensive utilization capacity of the mine.
Regional industry leader to improve the company's deep processing capacity
As the industry leader in Tibet, the company produced 27800 tons of lead-antimony metal concentrate and 23800 tons of zinc concentrate in 2016. The acquisition of Shanhai Industry and Trade and Lhasa Pingzhi will help to enhance the added value of lead, zinc, gold and other metal products, expand the company's deep processing business, and improve the integrated layout of the company's industrial chain.
Environmental protection efforts continue to increase, lead, zinc and antimony supply contraction intensified, supporting the rise in metal prices, maintaining the buying rating
According to the closing price on April 3, the company's EPS for 17-19 is expected to be 0.59,0.81 and 0.95 yuan respectively, and the PE of the previous share price is 31 times, 23 times and 20 times respectively, maintaining a "buy" rating.
Risk hint: the market environment changes, the asset restructuring of the target company is not as expected, and the investment project is advanced.